TORONTO - The world's five-largest automakers are on track to post the industry's most profitable year on record Ã¢ÂÂ continuing an upward trend that is likely to continue for some time, according to a report from Scotiabank.

Based on profits recorded over the first nine months of the year, Scotiabank estimates the global auto giants are headed for a combined US$61.4 billion in profit this year.

That's a huge rebound from the industry downturn sparked four years ago by a credit crisis in the U.S. banking sector. That crisis contributed to the reorganization of General Motors and Chrysler under bankruptcy protection, with bailout assistance from governments in the United States and Canada.

"This represents the third consecutive annual earnings improvement, a trend likely to remain in place for several years as our leading indicators point to ongoing gains in global car sales amid, a slow, but enduring economic expansion," Scotiabank economist Carlos Gomes writes.

"Highlighting the industryÃ¢ÂÂs dramatic turnaround, this yearÃ¢ÂÂs profit is approaching the massive cumulative loss of US$69 (billion) sustained during the tumultuous years between 2007 and 2009."

The report says North America is the leading region in profitability per vehicle, at more than US$2,000 Ã¢ÂÂ slightly above the profitability of Japanese vehicles sold domestically and well above the US$1,300 per vehicle in Asia outside Japan.

By contrast, Scotiabank estimates the five largest automakers are losing nearly US$1,000 for each vehicle sold in Western Europe Ã¢ÂÂ a deterioration from last year when they lost US$600 per model.

"The red ink is being exacerbated by the ongoing sovereign debt crisis which has slashed car sales in Western Europe to a two-decade low of 11.7 million units," Gomes wrote.

Scotiabank estimates Western Europe has capacity to make 18 million vehicles.

"We estimate that the region has an excess capacity of roughly 3.6 million units Ã¢ÂÂ at least 12 assembly plants Ã¢ÂÂ and profitability is unlikely to be restored until a significant number of these plants are closed."

The report says investors and corporate officials are worried about the industry's deteriorating prospects in Western Europe, but that's offset by the growing importance of developing markets.

"Car sales in Asia (excluding Japan) and Latin America are now more than double the sales pace in Western Europe Ã¢ÂÂ a sharp reversal from a decade ago when these emerging markets accounted for less than half of the volumes in Western Europe."